FOMC HedgeFund Meeting: Coming Up

[Brisbane Bear]

shorting the SPI (ORBS) is a great way to lose your money...everytime it looks like rolling over it jumps another 10 points....it really is the Terminator of all markets.

[Guest]

[Guest]

Don't Worry, We'll Just Jack up Your Property Taxes Again.....and Again.....and

 

debt disaSSter update:

 

U.S. Public schools are currently in debt to the tune of

 

a Quarter Trillion Dollars

 

mostly in bonds floated in the taxpayers names

 

to be paid by higher Real Estate Taxes

 

plus interest

 

wanna help?

 

buy a Home

 

then you can participate in the debt paydown

 

whether you like it or not

 

Public schoolleachers and adminaSStraitors get retirement pensions often 80% of salary, indexed to inflation, plus benefits

 

do you?

 

no?

 

well, you still have to pay theirs

 

or they will take your Home

 

Pay up!

[Guest]

San Diego is on the brink of filing Chapter 9 (yup) Bankruptcy.

 

 

Public union employees had better negotiate down those pensions right quick.

 

Or they'll be working at WalMart next to their private sector neighbors.

 

He who laughs laSSt laughs best.

 

 

"Good Evening, I'm Ben Dover, Welcome to WalMart!"

[machinehead]

jickiss is back!

 

and

 

In Houour of MachineHead, here is another Foobar Chart.

will Foobar cross Drooy????

 

that is the question!

 

Foobar:

<{POST_SNAPBACK}>

I don't know about DROOY.

 

But as of today, the good ship Crude Earl has passed Fannie Mae in the night, such that a barrel of crude costs more than a share of Fannie.

 

Sheeple: "But what does it mean, MH? Tell us, MH! Tell us now!"

 

MH: "OK, sheeple, calm down. It means 'things' are going up, and 'financial engineering' is going down. Way down. Consult a professional such as jickiss with any questions."

[Guest]

crude 100

 

CRB 500

 

yellow metal 1,000

 

Nascrapper 999

 

SOXX 299

 

and Fanny 4 Free

 

[machinehead]

At 9.29 a.m., Reuters reported that U.S. investigators have found instances of Fannie Mae employees falsifying signatures on accounting ledgers and making changes in earnings-related records without following proper procedures.

 

The story seems to have been disappeared.  I have looked at Reuters website and Yahoo financial news and can find nothing.

<{POST_SNAPBACK}>

Dunno what happened to that 'news,' Frances. But perhaps we can just substitute some old news, since these stories all tend to rhyme anyway:

 

Equity Funding wasn't selling enough policies to meet the demand that other companies had for policies to reinsure. So Equity Funding made them up.   

 

As the fraud progressed, more and more employees got recruited to help, and people started to get really creative. The problem with phony policies was that the company's auditors would randomly select some every now and then and ask to see the real-world files behind them. There were no files, of course, since there was no insurance. So to prop up the scam, conspirators threw late-night "fraud parties" to create phony files. When that solution proved inadequate, conspirators set up a secret office devoted exclusively to fabricating medical records and application forms on demand. The employees at the office, known as the Maple Drive Gang, spent most of their days killing time with knitting, champagne and Quaaludes, according to The Impossible Dream -- except when the clueless auditors at the main office would ask to see files for phantom policies. That's when the Maple Drive Gang would spend a frenzied few days creating dozens of policy files -- then return to their endless round of office parties.   

 

Meanwhile, a computer programmer had created software especially for concocting policies out of thin air. And at the time the fraud collapsed, the company was developing additional software that would easily "kill off" a certain number of phantom policyholders without arousing the suspicions of the reinsurers. By the time the company collapsed, more than half of the insurance policies on the company's books were fake.

 

Uh huh. Well, if you can create phony life insurance policies, why not phony mortgages?

 

You reckon somebody's already thought of that?

 

Sometimes there are even 'wheels within wheels':

 

The conspirators had a real eye for talent as well. In 1972, management discovered that four employees, quite separate from the fraud that the company was perpetrating, had teamed up to embezzle funds for themselves, mostly by filing phony death claims. When discovered, the quartet wasn't fired -- instead, three were rewarded with stock bonuses and all of them got a new assignment: supervising phony death claims on behalf of the "official" conspiracy.

 

The pros keep a tight leash on their auditors (Fannie's auditors KPMG were fired last year):

 

It helped that the outside audit of the company was led by an accountant who was utterly incompetent. He had a son on Equity Funding's payroll and borrowed money from an Equity Funding executive, apparently for an expensive gambling habit. Emboldened by their success in fooling the auditor, Equity Funding insiders, in the final days before the jig was up, went so far as to bug the temporary offices that were to be used by state insurance inspectors who were coming to investigate the company.

 

Fanron Equity Funding

[cwd]

jickiss is back!

 

and

 

In Houour of MachineHead, here is another Foobar Chart.

will Foobar cross Drooy????

 

that is the question!

 

Foobar:

<{POST_SNAPBACK}>

 

 

Jick, last night you mentioned a connection between SU and SUN. I would like to hear more about the connection.

Thanks for your well thought out observations.

[Charmin]

Why you should own resource stocks...

 

"Why are consumer prices merely creeping up while commodity quotes are surging? More and more, those raw materials are being used by Chinese (and other foreign) manufacturers instead of domestic companies. With their extremely low labor costs, the Chinese can absorb the cost of commodities and still export quite profitably. We have entered an odd symbiotic relationship with China. They ship us goods for dollars, and then invest the dollars in Treasury securities to finance our federal deficit. They don?t have a lot of choice - failing to return the dollars would send our currency into a decline that would sharply reduce both their exports and the margins of their companies. Further, it would push up U.S. interest rates, with negative effects on our economy that would further damage trade."

By Robert Cardwell

Stock traders almanac

[intertrader888]

Why you should own resource stocks...

 

"Why are consumer prices merely creeping up while commodity quotes are surging? More and more, those raw materials are being used by Chinese (and other foreign) manufacturers instead of domestic companies. With their extremely low labor costs, the Chinese can absorb the cost of commodities and still export quite profitably. We have entered an odd symbiotic relationship with China. They ship us goods for dollars, and then invest the dollars in Treasury securities to finance our federal deficit. They don?t have a lot of choice - failing to return the dollars would send our currency into a decline that would sharply reduce both their exports and the margins of their companies. Further, it would push up U.S. interest rates, with negative effects on our economy that would further damage trade."

By Robert Cardwell

Stock traders almanac

<{POST_SNAPBACK}>

 

well, another China bull*hit.

 

First, China's labor cost is on the rise. The manufactures on the east coast

are complaining of labor crisis.

 

Second, they do not export profitably. In fact, most chinese biz are more

interested in market share than profitability.

 

Third, China has been diversifying quietly and using its currency reserve

to acquire resource holdings around the world. There have been great

debate in China about buying treasuries. They think they were hurt badly.

This new Chinese government has been making subtle changes.

 

In other words, when people talk about funnymentals in other countries,

it is usually camourflage.

[Charmin]

For energy stocks I have ATLS on my radar with the $37 area to watch..

VPI is also on the radar on a pullback - the best entry would probably be in the 26 area, but the dippers may pile in higher...

[Charmin]

MSSN looks like a worthy candidate in the 6.80 area...

[PeakOil]

My ongoing real estate saga:

This morning I was startled to find a new listing for a condo not far from mine. It has essentially the same square footage, 1368, but they have 3 bedrooms vs. my humble 2. They are on the top floor of a 3 story building so they have a "view". I have no view, but mine is a townhome with two nice patios. They have a newer building.

They are asking $1,088,000

Unbelievable. My solid $749M is probably $849M. I've started to look for a rental and will try to put my place on the market next week.

I'll keep you posted.

I'm probably early....but who knows.

<{POST_SNAPBACK}>

I hope that you are right about being early. Better to be early than late.

[Charmin]

I'd be interested if GDP got down into the confluence area. It appears to have done a 50% retrace of the last move up..

[bearvest]

Why you should own resource stocks...

 

"Why are consumer prices merely creeping up while commodity quotes are surging? More and more, those raw materials are being used by Chinese (and other foreign) manufacturers instead of domestic companies. With their extremely low labor costs, the Chinese can absorb the cost of commodities and still export quite profitably. We have entered an odd symbiotic relationship with China. They ship us goods for dollars, and then invest the dollars in Treasury securities to finance our federal deficit. They don?t have a lot of choice - failing to return the dollars would send our currency into a decline that would sharply reduce both their exports and the margins of their companies. Further, it would push up U.S. interest rates, with negative effects on our economy that would further damage trade."

By Robert Cardwell

Stock traders almanac

<{POST_SNAPBACK}>

 

 

It's comforting to know that Mr. Cardwell has confidence that the continued investment by foreign states and nationals in U.S. Treasuries will keep the dollar from declining.